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Closing Bell With Maria Bartiromo

News/Business. Maria Bartiromo. Analysis of the day's winners and losers in the stock market. New.

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01:00:00

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SCANNED IN
San Francisco, CA, USA

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Comcast Cable

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Virtual Ch. 58 (CNBC)

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mpeg2video

AUDIO CODEC
ac3

PIXEL WIDTH
528

PIXEL HEIGHT
480

TOPIC FREQUENCY

China 22, Alcoa 12, Us 11, S&p 4, Klaus Kleinfeld 4, Schwab 4, U.s. 4, India 4, Imf 2, United States 2, Klaus 2, Goldman 2, Lipper 2, Rick 2, Nicki Minaj 2, Russia 2, Midstream 2, Geico 2, Mariah Carey 2, Taco Bell 1,
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  CNBC    Closing Bell With Maria Bartiromo    News/Business. Maria Bartiromo. Analysis of the  
   day's winners and losers in the stock market. New.  

    October 9, 2012
    4:00 - 4:59pm EDT  

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maria is talking to chairman and ceo klaus kleinfeld before he speaks to analysts. coincidence or not, these are the executives from vector group ringing the closing bell. they rang it five years ago today as well. what are the odds? see you tomorrow. it is 4:00 on wall street. do you know where your money is? welcome back to the "closing bell." the bear is in control of the street today on this, the fifth anniversary of the all-time closing high for the dow and the s&p 500. investors bracing for what is expected to be a contraction in earnings for the third quarter. will fundamentals deflate what has been a good rally this year in top strategists will weigh in. alcoa moments away from kicking off the earnings season. i'll speak with chairman and ceo klaus kleinfeld in a moment. take a look at how we're
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finishing the day on wall street this afternoon. the dow jones industrial average at the lows of the afternoon down 110 points. volume deadly. nasdaq down 47 points. technology one of the weak spots today, down 1.5% on the nasdaq at 3,065. the s&p 500 weaker by 14, about 1%, at 441. we're moments away from the quarterly earnings due out from alcoa and yum brands. let's get today' market reaction. good to see you, guys. thanks for joining us. >> thank you. >> mike, what are you expecting out of earnings this season? >> i think we're going to have a negative quarter, maria. looks like we're down 1.21 according to the cap iq consens consensus. i think we're going to have weakness in the materials sectors. i think there's going to be a surprising strength in financials and consumer discretionary. >> i know i've asked this a
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million times, but is it priced into the markets we're going see a weak quarter, or do you think the central bank easing and the money flowing into the market has clouded things up in terms of what the market's expecting? >> well, i think the market is sort of expecting that they're going to be weaker than expected. i think you're right. i think we have a little bit of acid inflation, as investors are chasing any bit of yield they can get. equities, they're taken further risks by going to more equity oriented instruments. effectively, it's offis -- offset by these technical drivers. >> mark, what are you hearing from clients in terms of strategy? >> i think as far as what you hear from clients, obviously looking at the election, looking at fiscal cliff. i think earnings are probably a bit of a negative tone. also priced into this market. i think if the guidance forward
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is what people are going to be looking at, maybe more so than what the actual numbers are. it's hard to continue to keep growing earnings as we've had with 2% growth. i think if people got flat earnings, they'd be surprised this quarter. as far as what we're telling clients, the environment you want to stay is diversified as possible. i think this last quarter was a great example of that. europe, everybody looks at the negative in europe, yet it was a good place to be. spread your bets out right now. >> so do you expect that we are at this point going to see pretty good guidance, tough guidance? what about that guidance that you're looking for in. >> yeah, i think that's going to be the big question here. i think today's a great example of that. you have alcoa, the traditional capital goods manufacturing cyclical versus a yum brands, which is going to tell you maybe how the global consumer is doing. even the guidance we're going to get today may very well set the tone for what kind of messaging we get this earnings season. >> i want to tell you that alcoa
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is out three cents a share, actual earnings. expecting a flat showing. so it looks like it's better than expected. we are looking at a pop in the stock as these numbers are released. of course, we want to get more details on the quarter. revenue coming in at $5.8 billion versus an estimate of $5.4 billion for the third quarter. so you got $5.8 billion in revenue on three cents a share on the bottom line earnings. let's talk to the man in charge. joining me now is the alcoa ceo klaus kleinfeld on the telephone. always wonderful to have you on the program. tell me about the quarter. how tough was the environment, and how tough would you characterize business the last three months? >> maria, good hearing your voice. the economy really continues to misfire and you see alcoa is really on the business side in high gear. we obviously in this environment focus on the things we can control. we got one thing there, two
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major issues were overshadowing it a little bit. a civil litigation case we moved out of the way and mediation, which has been pending there since 1989. that's gone. revenues, $5.8 billion. performance is basically paying off. we're hitting profitability highs. in the upstream business, you actually see when you open the hood that there's strong productivity underneath it and that we're adjusting the structure. that pretty much gives an idea of what's happening in the quarter here. >> a couple points, klaus. you mentioned that settlement with alba. is there any reason to believe there's more to come on this whether or not other lawsuits sort of carry on in the next quarter and the next quarter, or can you categorically say this issue is behind? >> well, the civil settlement is behind us. that's one thing. i mean, the thing that's still open there is basically the settlement with the doj and sec.
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we will continue negotiations on that. so that's important. then on the civil side, there's a potential for another roughly 20 million due to an agreement we had with awa. >> what about some of the fundamentals in the quarter? we were looking at aluminum prices, near three-year lows. you've caught capacity in the united states. would you consider closing more if prices remain sluggish in are you expecting prices to stay in the dumps? >> well, on the pricing side, we see a very interesting thing. we see on the one hand the aluminum market fundamentals are strong. we see strong demand. we just came out and basically said this year is going to be 6%. we took it down one percentage point from where we had it earlier. we've always said demand was going to double in this decade. the assumption is that it's going to grow 6%. we've seen over the years that the demand increase has been
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much, much higher. we see demand and supply pretty much in balance. we see strong regional premiums, which is a good indication of the physical as well as the financial demand. at the same time, the market basically has forgotten those fundamentals and sentiments basically dominates pricing. >> are you expecting it to slow down from 2012 to 2013? >> we'll see. we haven't put our '13 number out. it's still -- there's still a lot of uncertainty out there. at this point in time, most markets are showing some positive growth. imf came out yesterday evening with their gdp numbers and basically put europe as well as china down. i've been in china about three weeks ago for a whole week and did a lot of -- had a lot of conversations. i'm relatively optimistic on china, actually.
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they understand the economy is slowing down. they've put a program in place, which is starting now. it's probably going to take to the end of the fourth quarter to have this visibly in the economic activity. other than that, i'm pretty optimistic. we continue to see good growth in the aerospace segment as well as -- and that's kind of a surprise. u.s. automotive continues to perform very, very well. that's good. i mean, heavy trucks and trailers are slowing down, which already shows you there's some jitteriness in the market. that will most likely continue as long as we have things like the eurozone crisis as well as the discussion about the financial cliff overhanging the sentiment. >> your leadership obviously has been complimented. you know, you've got to operate a business regardless of what's going on around you, klaus. so how are you going to offset some of these sticking points like the fact that aluminum prices have been declining, like the fact we are in this global slowdown? everybody wants to negotiation are you going to unlock valuely
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splitting the company up? >> maria, we are going unlock value with whichever way is the best here. look, i mean, a year ago aluminum prices were at $2,800. guess what? the alcoa stock price was at 18. so we can't deny the fact that we are dependent on where the aluminum price is on the upstream side of things. we're going through a pretty fundamental refocusing of the upstream business from changing the pricing mechanism on the aluminum side, from getting our legacy issues behind us, and bringing us down on the cost curve. i think there's nobody out there who's not seen that we have been getting those businesses on to a new performance level. record performances in the midstream business, record performances on the downstream business. plus, growth on both sides. we have a clear saying inside. we got to earn the right to own
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these businesses. we have to have the alcoa advantage shine. that shines through growth and profitability. we're focusing on the things we can control and obviously that gets us best through the things we can't control. >> all right. so you cannot categorically rule out a splittup then. you're looking at everything. >> you're been in business long enough to understand that we are looking at the way to generate value. we know how to do it. we've communicated that to the market outside and the market can see that in our performance. we will continue to do that. i also believe that we will most likely, once the market ticks up again -- and you just saw in the last two weeks how quickly the market can change course again. you saw an uptick from roughly $1,800 per metric ton to $2,200. had nothing to do with the structural changes in the market. it was purely driven by some
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external events. basically here were four events. it was the announcement of mario draghi on the european side. it was the chinese stimulus program, the german constitutional court, and qe-3. those four factors in just ten days drops the aluminum pricing $400. that's how quickly things can change. so if we were to worry about that every day, we would totally defocus the organization. so really, everybody knows what to do. we know that we want to move down on the cost curve on the upstream side. we know that we continue to innovate on the midstream and downstream side. that's what we need to do. that's what the focus has to be on. >> real quick, klaus, i know you have to jump to talk to analysts, but what guidance are you going to be giving on that call with analysts? we all know the most important thing is what you're looking for for the fourth quarter. what are you looking at? >> fourth quarter has not traditionally been as strong as the previous quarters. that's more the seasonality we
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see in there. the rest, we believe 6% demand growth, markets basically will continue to be in a supply/demand balance, physical as well as financial demand is going to continue to be strong. the rest basically is up in the air. it's up in the air on where the metal price will end up as tstuf we can control. we will continue to get productivity out and grow our revenues and get new products out and don't innovate. by the way, there's one thing that is very close to our heart from the founders. basically ill lum niezing one industry to another and allowing mankind to fulfill their biggest dreams like flying. we are very, very proud in an event that just happened a couple weeks ago when curiosity, the new mars rover, landed on mars. guess what? it's made out of aluminum. there's other alcoa material on
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them. ill lum niezing the world has happened. we're going into outer space. >> all right. klaus kleinfeld making history. that's terrific. good news. always wonderful to have you on the program. thanks for calling in. we appreciate it. we'll watch the call with analysts you'll be doing shortly. >> likewise. bye-bye. >> looks like we have a win on yum brands. the numbers are out. 99 cents versus 97 cents, raising guidance. the revenue is being questioned here on yum brands. this is the third quarter revenue at $3.57 billion versus $3.65 billion it estimate. we have a pop after hours. stock on the move, even though it looks like the third quarter revenue was light. we're going it look at this story and follow the stock action in the extended hours and be back with more after that. stick with us. more to come on this jam packed edition of the "closing bell." coming up, the head of one of the world's largest investing
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firms warns of a worse than expected global economic slowdown. so how's he going to play this? find out next. plus, bonus round. wall street execs expecting larger bonuses this year. well deserved or wishful thinking? and do you love thy neighbor this much? did you know your tax dollar may be going to neighbors and banks for home sales? why someone here says it's time to get the government out of the housing market. that's all ahead on the "closing bell." if we want to improve our schools... ...what should we invest in? maybe new buildings? what about updated equipment? they can help, but recent research shows... ...nothing transforms schools like investing in advanced teacher education. let's build a strong foundation. let's invest in our teachers so they can inspire our students. let's solve this.
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all right. we got more situations developing. yum brands out with earnings. to jane wells. she's got the latest on yum brands. over to you. >> yeah, maria. you had it right going into the break. they did beat the street on the bottom line, coming in at 99 cents, excludeing special items. that's up 19% from a year ago. the top line came in a little light. the street was looking for $3.65 billion. the real story is what's happening in china. they reported an operating loss in china last quarter. this time, as promised, they have returned to double-digit profit growth with the china system sales increasing 22%.
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same store sales increasing 6%. now this is a slowdown from last quarter when same store sales in china grew 10%. however, the company saying margin performance in china improved dramatically, and they're increasing the number of new stores they said they'd be opening in china from 700 to now 750. the u.s., 6% same store sales. maria, back to you. >> all right, jane. thank you so much. we'll keep watching that stock, which is of course moving higher. joining me now to help break down the numbers and take a closer look is bill barker. bill, good to see you. your reaction to the latest earnings report. >> thanks for having me, maria. sounds like another good report for yum. not terribly surprising. this is a company that has a lot of choices all over the world about how to allocate its capital. it's put a lot of investment into china but not just there,
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into india and russia. the last couple of years may have been somewhat stagnant in the u.s., but it seems to be turning around. i think it's another good day for yum shareholders. >> that's what we're seeing now, but isn't this company sort of very exposed to china, more so than other chain operators? i recognize what you're saying, that they're all over. but is it doing enough to offset the rising commodities and lay door costs and slower growth coming out of that region? >> well, based on the numbers, as you've reported them, it appears to be doing so again right now. you noticed last quarter when there was really a bit of a hiccup in china, the stock did take a hit. the story in china over the next decade is one of enormous growth opportunities still. you're right. yum did invest earlier and more there than a lot of its rivals and has almost entirely benefitted from that choice. it's going to have some hiccups
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when labor costs rise. that's not an entirely bad thing for the company. more money for more potential consumers for yum all across the country is not entirely a problem. i think that, you know, the company's done another good job for this quarter and is raising guidance for the rest of the year. >> this stock was always a hot stock. i remember when it first went public. it was a real hot stock. would you commit new capital to this stock at this level? >> well, you know, yum is the very first stock that we bought when we started our asset management business here. it was sort of them blematic of what we're looking for, which at the time was quite a bit more of a value. but a very good growth story wrapped up in that. three years later, we see that it's been able to turn around over some real slow and troubled sales at pizza hut and taco bell. so, you know, you'd want to look at the numbers a little bit more
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carefully, decide wihere it fit in your part folio. we're not going to be selling any time soon. >> where do you think the growth comes next? >> well, india, i haven't seen the numbers for this quarter, but it was growing at 30% last quarter in terms of sales. that is an enormous market opportunity. you look at where it's gone in china over the last decade, and you insert even sort of part of that success story into india, and you see a company that can do a lot with what it's got, a lot with the management it's already got in place. russia, there's growth all over the world for this company. it's not going about it, you know, in an unmeasured way. i think india's the primary target. >> all right. we'll leave it there. good to have you on the program. thanks so much. >> thank you. >> we appreciate it. see you soon. don't miss jim cramer's interview with conagra ceo.
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meanwhile, more worries for the global economy. the imf cutting its forecast for global growth. silver lake partners has $14 billion in assets and has put money to work in china. joining me now to talk about that and a lot more is silver lake partners co-founder glen hutchins. great to see you. thank you so much for joining us. let's start globally and the economy right now. i know you're traveling a lot. a lot of warning signs out there. how do you feel about putting money to work in some of these hot spots that were big engines of the economy but are slowing down now? >> we focus primarily on technology. china is a microcosm of the world, which is a tale of two cities. large concerns about
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macroeconomic growth. i tell you, 6% is a lot better than zero. point one. if you look inside these economies, the key concern about china right now is overinvestment potentially in fixed assets, primarily real estate and infrastructure. if you take that and put that aside at the moment, if you look at what's going on in the chinese economy, it's just roaring in terms of its growth. we made an investment recently with a large group. in fact, it's one of the largest investments ever made in alibaba. it's growing quickly with the trend of the penetration of the internet in china. chinese just recently announced they're going to hook up broadband communications to 250 million households in china.
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that's almost as many people as we have in the united states. >> can yahoo! compete with that? >> they do very different things. alibab, one of the great things about the business is it's a commerce company. it's more like an amazon or ebay than a yahoo! in that it does enormous amounts of commerce online. that's extremely important in the chinese economy where the systems aren't as developed. large smaller companies don't have the way to reach export markets the way the big companies do. take a step back. very low internet penetration in china. very rapid growth of internet commerce. the company like alibaba is the dominant player. terrific place to be regardless of whether chinese growth is 10% or 6%6%.
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>> you're absolutely right. i'm thinking of your nasdaq investment, but there are plenty of others. >> sure. quite a few. >> in the scheme of things, we've been seeing these trading glitches and criticism about high-frequency trading. how does that play into your investing in terms of worries that high-frequency traders are getting ahead of others as well as electronic trading in general has been seeing more mistakes or glitches than in the past. is that the way you see it? >> just as full disclosure, we do own a high stake in one of the high-frequency trading firms. to take a step back for a minute, one of the things we've done is to invest at the intersections of financial services and technology where you've used technology to reduce costs and substantially increase customer service and product offerings to customers. a very good company is
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ameritrade. you're competing with the human interaction model. you have lower cost, better products for your customers. today, where technology now operates in a very fundamental way, markets worldwide, there's a reasonable question to be asked, whether the technology is robust and reliable enough to operate the markets. i think that it is, but i think we need to ask those questions. we need to restore people's confidence in that because of some of the glitches that have occurred. by the way, these glitches that have occurred, they've been with the use of technology to run markets, just like technology to run your car. they're not about high-frequency trading. >> i know you've been investing in a number of areas, whether it's private as well as the public stock market, but what's your take broadly speaking on this market whereas the central bank easing has really powered things forward? yet the fundamental story has actually weakened. >> that's a really fundamental
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point. where we are today. so i've spent some time over the last several months talking to people allocating capital. as a fundamental concern that we're in an era of very low growth around the world, which means -- which will reflect itself in the revenues of companies. the ongoing restructuring of existing balance sheets, bank balance sheets -- so if you think low growth and the ongoing process of the great deleveraging. i don't think that -- the operating assumption most investors have means low interest rates for a long period of time. the dilemma you have in a world where you have very low growth, very low returns potentially on equities, no yield to be had in fixed income securities, a couple points of inflation, what do you do? that's the question. >> right, yeah. >> i think the answer is silver lake. no, i'm just kidding. the answer is to find the parts
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of the u.s. economy that are growing disproportionately. technology is one of them. energy is another one. allocate disproportionate amount of capital there. also, to invest in parts of the global economy. >> which is why you're investing in alibaba. >> that's the answer. >> which is why you're finding opportunities in places like china. thank you so much for joining us. good to see you as always. we appreciate it. up next, well deserved or wishful thinking? half of wall street employees expect higher bonuses this year. if they're right, will there be a backlash? or with the marks up double digits this year, is it deserved in. later, should the government stop giving tax breaks to homeowners and banks to sell unwanted homes? your tax dollars helping to finance these folks. stick around for this debate. also, are healthy profits on the menu the nation's
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restaurant? jane wells with that story. back in a moment. you. we know you. we know you have to rise early... and work late, with not enough sleep in between. how you sometimes need to get over to that exit, like, right now. and how things aren't... just about you anymore. introducing the all-new, smart-sensing... honda accord. it starts with you.
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welcome back. wall streeters have a message this year. show me the money. a new survey shows nearly half of all wall street employees are expecting their bonuses to be higher than last year. the market higher so far, so should the bonuses be higher? joining me now, john singer, an attorney who represents wall street employees in bonus
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disput disputes. john, you say the bonuses should be bigger this year than last. how come? >> well, the primary reason is because the work force is so strong. bank of america is in the process right now of effectuating 30,000 job cuts. so the work force is going to be so shrunk. that means the bonus pool for those who remain and produce and are successful is going to be much larger. that's the reason why bonuses this year, an average, should be higher. >> jeff cox, anything surprising you in this survey? >> yeah, i would say good luck with that. i think that the thing that surprises me is the level of optimism, i think, with the level of public pressure, with the way the banks are trying to position themselves now, going to be very difficult to get those bonuses up to the level where wall streeters think they're going to be at. what management people are telling me on wall street, you're going to be seeing a bifurcation of salaries. the big producers are going to be the ones getting bonuses. the other ones will get weeded
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out. this is a paradigm change for the way wall street is going to be structured. >> well, why? the banks are doing pretty well. they've cut expenses . they've raised capital. bart, why shouldn't everyone get a raise? >> we have a serious problem in the fact that wall street is generally overpaid. >> who is judging, right? who is telling you -- i mean, is julia roberts overpaid? she makes $20 million a movie. >> she's overpaid because we have a taxpayer buttress system. these bankers basically pay to gamble, overpay to gamble. their losses are suffered by the rest of us, by taxpayers. >> there hasn't been a hollywood bailout yet, although i guess it's not out of the question. i just think this is a level of just public pressure. wall street guys, hey, don't weep for them. the average salary on wall street is still about $350,000 a year. >> i've got to play devils s advocate.
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john, what are you saying? are we going to start crying for everybody on wall street that they want more money? make the case. >> i don't think wall streeters should engender sympathy. what jeff said is actually consistent with what i said. there's going to be a bifurcation. they're going to weed out the low producers. they're going to weed out a lot of the work force. hence, those who remain at the company who produce, who do well, who generate revenues, are going to get larger bonuses because the work force is beginning to be so shrunk. the pool in and of itself may shrink, but the work force there to reap the benefits of that pool is so diminished. as far as what the other guests said, wall streeters -- it's always been the same. if you're a trader and up $50 million, $150 million and you produce for the bank, you're producing for the shareholders. the shareholders are benefitting. why shouldn't you be paid commensurately with the way you produce? if you're generating shareholder value, you should get paid as well. that's always how it's been. >> bart? >> yes, but socially these bets are against main street.
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s&p found that for every dollar that a bank bets, it's making 35 cents or $1.35 if you will. after dodd frank is implemented and there's clarity, that's supposed to decline to $1.17. again, the system is rigged to benefit these bankers because of the opacity of the markets and so forth. so i don't know that you would call this skill. i think you would call it a rigged game. >> it's not a rigged game because if you're a trader and you're down and you have a losing book, you're not going to get a bonus. if you're up and you've generated revenue and productivity for the bank and henceforth the shareholders, you should get paid. >> that's a good way to end this, gentlemen. >> what should is going to be what prevails here. >> we will know soon enough. gentlemen, thanks very much. red alert on housing. you may be funding a deal between your neighbor and their bank. the story coming up.
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later, are higher commodity prices eating into the bottom line of the nation's leading restaurant chains? jane wells with the story back in a moment. the world... ...you see they all have something very interesting in common. they have teachers... ...with a deeper knowledge of their subjects. as a result, their students achieve at a higher level. let's develop more stars in education. let's invest in our teachers... ...so they can inspire our students. let's solve this. thank you, mr. speaker, uh, members of congress. in celebration of over 75 years of our government employees insurance company, or geico...as most of you know it. ...i propose savings for everyone! i'm talking hundreds here... and furthermore.. newcaster: breaking news. the gecko is demanding free pudding. and political parties that are actual parties! with cake! and presents! ah, that was good.
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welcome back. the housing recovery has been fueled by a surge in short
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sales. that's when you sell your house back to the bank for less than you owe and the difference is forgiven. the government has been giving discounts to do as many short sales as possible. get the inventory off the table. should taxpayers be footing this bill? let's talk about it. diana is here with the story. over to you. >> well, banks like short sales because they're a lot less expensive than going to foreclosure. government likes short sales because they're more politically palatable. that's why government is pushing them. take a look, if you will. short sales surpassed foreclosures last year. the treasury's home affordable foreclosure alternative program has so far paid out $333 million for short sales to banks and bar rowers. that's part of the $10 billion set aside for the much larger loan modification settlement. but the signing earlier this year also pushes short sales.
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under that, the banks have forgiven $8.67 billion in mortgage debt. that debt forgiveness is tax free. again, thanks to congress passing a tax relief act on short sales back in 2007. a congressional committee estimates that will cost close to $1 billion in lost revenue to the government. now, given that relief and the fact that banks are really pushing these short sales and doing themselves, the question is, do we really need government to keep funding these short sales, maria? >> diana, these are the questions we'll keep following. thanks so much. they ask, should the government get out of the housing business altogether? rick santelli thinks so. jason says this isn't the time to kill these programs. rick, make the case. >> well, my case is why doesn't the government just buy them all, all the houses that are out there in foreclosure, vacant, bulldoze them down, give the tax bill to future generations, boom. housing fix. just because it's expedient
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doesn't mean it's the right thing to do. what, we're going to give them a break on their principle and their income tax? the government needs to clear the zone. they've offered these life preservers for years, and it prevents the healing process from truly beginning. >> jason, what do you think? you're arguing these programs should continue. why should taxpayers be subsidizing something banks would likely do on their own since it's in their best interest any way? >> there's a light at the end of the tunnel for homeowners who are under water. they can see the light at the end of the tunnel. what we're now proposing is to build another five miles of tunnel, and we're going to build those five miles in the next 83 days unless the extension is pass passed. we're at a critical moment in housing right now. the money is finally getting through to homeowners. now is not the time to allow them to go down into foreclosure. rick wanted to propose bulldozing. i'm proposing something sensible.
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>> i didn't propose it. in the extreme, it makes it so ridiculous that just because this is moving the process along quickly, doesn't mean it's right. the more free money that's out there and the more real estate transactions, the better off you are. >> rick, stick to your day job and cover bonds and not my company. i've never done a short sale. >> i just asked you if more real estate transactions helped your business. >> not for my company, sir. no, sir. >> just curious. >> no, sir. but it's good for homeowners. i'll tell you why. can i tell you why, rick? >> hey, why -- >> listen, listen. >> it's always good if you're on the receiving end. s it. >> if my neighbor gets that benefit, i benefit. that means his front yard won't look like -- >> i believe in principle! >> i can't hear anything. i can't hear anything when you're both yelling. >> rick, let me tell you something. if my neighbor's yard looks like
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nicki minaj and mariah carey had a fight there as opposed to looking like augusta, it's better for me. >> we cut those lawns and don't charge anybody and don't ask. >> unfortunately, it's not the way to get it done. it's not a nationwide policy. if we put this in place and extend this tax cut, we're putting money into mostly middle class americans. that's money they can use -- >> where does the money come from, sir? >> the money comes from taxpayer, right? >> it's a tax break, rick. >> so you're -- wait, wait, wait. >> okay. >> it's a tax break for the receiving end. it's a tax donation on the other end. >> would you rather the money go to some bureaucrat in washington? i thought you were against that. >> i'd rather the government clear the zone. >> well, it's a process. it's going to take some time, my friend. >> it's a freebie process. >> it's a smart policy process. may not be pretty, rick, but we got to get there. >> smart policy would have been not to make the banks make bad
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loans in the '90s that put us into the mess. >> we're going to hear from our audience. you both made great points. i'm going to hope our viewers write in to tell us what they think about this. i'm going back in forth in terms of who i agree with. guys, thanks very much. appreciate your time tonight. see you soon. what do the latest earnings do to your money tomorrow morning? that's where we're going next. hopefully it won't turn into this. three of the top market pros weigh in on tomorrow's actions. then, are yum brand's earnings just a taste of what's to come for the industry? jane wells up next on the beef she loves biting into. stick around. hen you take a clo. ...at the best schools in the world... ...you see they all have something very interesting in common. they have teachers... ...with a deeper knowledge of their subjects. as a result, their students achieve at a higher level. let's develop more stars in education.
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we're raising the bar on flying and tomorrow we will up it yet again. welcome back. the first day of earnings season rounds up. >> the expectations for earnings were low, but it looks like we came in on the high side with alcoa and yum. let's look how they're doing in the after hours session. alcoa is higher by .6%. three cents above the street on eps. look at yum brands as well. we saw a bigger spriike there coming off that high. a two-cent beat on eps. slightly light on the revenue but raising guidance. we saw same store sales improvement here in the united states. we saw that same store sales growth taper off a little bit in china. again, still 68.50 in the after hours session. >> all right. thanks so much.
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other big names in the restaurant industry also getting set to serve up numbers. jane wells with that angle. over to you. >> hey, maria. still trying to get my head around that nicki minaj, mariah carey cat fight in the housing segment. yum today. next week we get domino's, chipotle, and mcdonald's. consumers are expected to trade down from taco bell. goldman also sees upside for cheesecake factory. here and into the future, they expect it to go 37%. wild goldman also likes panera, shares were downgraded, believing management may be less willing to raise prices in the face of inflation, squeezing margins. for domino's, analysts like what they're heari ining about the n
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pan pizza. not a lot of love for mcdonald's, where the street is looking for flat sales. wow. mcdonald's a lagger? finally, it expects starbucks to announce a 20% dividend raise in the coming weeks, which may serve as a positive catalyst. the big question beyond food casts, gasoline and the impact that may have. gas so expensive in california this week people have been driving to mexico to fuel up. maria, talk about making a run for the border. back to you. >> jane, thank you so much. >> that's back to you. i'm done. >> i know you're done. what i want to see is if some of these expenses in terms of higher food cost is going to show up in these numbers. >> they're going to talk about it more into 2013 because what you're seeing in the short term is these high food costs means that a lot of protein, a lot of meat is being slaughtered early. you won't have the high meat cost now. you will next year. 2013 when to look for that. >> we'll keep looking. jane, thanks so much. see you later.
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a fresh batch of key earnings and economic reports could move your money first thing in the morning. keep it here. we're going to talk to three of wall street's best economic analysts and how
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welcome back. 30 seconds on the clock. our next guests are ready to tell us what they think will move their money. paul, we begin with you. what are you looking at tomorrow? >> we have international markets moving in ranges for the past four weeks. investors continue to wait for decisions on policy about spain, yeas rr and the european banking union. economic data are going to push markets up to the top of the range and down to the bottom of the range. tomorrow we are looking for weak data from japanese machine tool orders and from french and italian industrial production. >> thank you. 30 seconds on the clock. what do you look at tomorrow? >> unemployment got hit last friday. earnings season kicks off today with tough expectations as we had companies lowering guidance.
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a couple of names we are looking at. clean harbor exhibits a bullish signaling and impending rally. >> we'll leave it there. lathe, you are up for what you are watching for tomorrow's trading session. >> tomorrow we want to see the anecdotal evidence of the economic conditions. it may give us a glimmer to how much longer we can expect qe 3. the financial sector has been outperforming since the release of qe 3. we think negative on the dollar and bullish for gold. >> do you think the market is ahead of itself? >> in the short term but just for a couple of days. >> we'll leave it there. up next my thoughts on earnings
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my observation of day one of third quarter earnings. the kickoff was good. is this afore shadowing of what to expect. is it priced in or will we see a significant contraction in earnings and a humbling for investors? the market has very little room for error, we know. even with today's losses of 110 points s&p capital iq converms estimates are going up. the market keeps rallying on everything but fundamentals. it is even grasping at things like mitt romney's strong debate performance. some call the stock gains the next day a romney rally. money moving into stocks and the theme don't fight the fed again
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and again. the economy is showing signs of cracks. today cutting global growth. it is always important to note fundamentals matter. earnings and profits matter. history has not been kind to investors when they have ignored this. we will keep watching those fundamentals. before we go take a look at wall street action today. we had a negative showing. the dow jones down. the volume was light. nasdaq gave up 1.5%. and the s&p 500 down 14.5 points. here are the recaps on the earnings news. alcoa up a fraction. yum brands definitely better than expected numbers as well as revenue higher. the stock rallies 4% in the extended hours